- Tesla is poised to invest between $3 billion and $4 billion on Nvidia hardware in 2024, CEO Elon Musk revealed on X.
- Musk emphasised that Nvidia hardware will account for roughly two-thirds of the cost of building AI training superclusters.
- Tesla reaffirmed its capital expenditure forecast of over $10 billion for this year, with expectations of $8 billion to $10 billion annually in subsequent years.
OUR TAKE
Tesla’s substantial investment in Nvidia hardware reflects the growing importance of AI in the automotive industry. By enhancing its AI capabilities, Tesla aims to reduce costs and improve vehicle safety and efficiency. This move could position Tesla at the forefront of the AI revolution.
–Jinny Xu, BTW reporter
Tesla is expected to spend between $3 billion and $4 billion on Nvidia hardware this year, according to CEO Elon Musk in a recent post on X. Musk mentioned that of the $10 billion allocated for artificial intelligence-related capital expenditures in 2024, approximately half would be for internal use.
Investment in AI hardware
Elon Musk has disclosed that Tesla plans to spend between $3 billion and $4 billion on Nvidia hardware in 2024 during an event on X. This investment is a portion of the company’s $10 billion allocation for AI-related capital expenditures for the year, with approximately 50% earmarked for internal projects. This considerable financial outlay highlights Tesla’s dedication to enhancing its AI expertise, especially in the realm of autonomous driving technology and other AI-powered initiatives.
Focus on AI training superclusters
Musk emphasised that Nvidia hardware will account for roughly two-thirds of the cost of building AI training superclusters. These superclusters are essential for processing vast amounts of data required for training advanced AI models, which are critical for Tesla’s autonomous driving technology. Earlier in the day, Tesla reportedly instructed Nvidia to prioritise shipments of AI processors to Musk’s companies X and xAI over the electric vehicle manufacturer. This prioritisation indicates a strategic alignment towards enhancing AI capabilities across Musk’s business ventures.
Upcoming shareholder vote
This announcement comes just before a pivotal shareholder vote on Musk’s compensation package at Tesla. The vote is seen as crucial in determining Musk’s future earnings, which are tied to the company’s performance metrics. In April, Tesla reaffirmed its capital expenditure forecast of over $10 billion for this year, with expectations of $8 billion to $10 billion annually in subsequent years. This consistent investment in capital expenditure highlights Tesla’s long-term strategy to maintain its lead in the EV market while simultaneously advancing its AI and technology infrastructure.
